Remarks to the National Industrial Conference Board.

Mr. Blough, Mr. Primer, my fellow countrymen :

I apologize for the delay, but I was having lunch with one of the great Americans, one of the great leaders of our time, my longtime friend, General Eisenhower, and someone brought up the balance-of-payments question. He gave me his views on that question and I received them, and therefore I have been delayed.

This month of February 1965 is an important-and impressive--anniversary for our free economic system.

Four years ago, in February 1961, our economy was in the trough of recession. Our profits were down. Our unemployment was up. Men and machines were falling idle. For the third time in less than a decade, our system seemed to be faltering.

To businessmen and workingmen alike, the question was really whether the new decade was to be the Soaring--or really the Sagging--Sixties.

Today we have the answer.

For 48 consecutive months our economy has soared--as never before in our history.

Our gross national product and personal income have risen one-fourth.

Industrial production is up one-third.

Corporate profits after taxes are up twothirds.

Our prices remain the most stable prices in the entire Western World.

And the end is not yet in sight.

This is a proud and a very welcome record--a record in which you have given your best to make.

But the age in which we live is a demanding age--and it indulges us little time for serf-congratulation.

By the very success of the performance these last 4 years, American business, labor, and government have raised a new and far more exacting standard of performance for the future.

The old rhythm of recessions cannot again be easily excused as either inevitable or unavoidable.

The self-interest of any segment cannot again be justly raised above the responsible self-restraint of all segments.

We have a partnership for prosperity.

For my part, I intend to do all that I can to keep it.

But this age requires a great deal more of us than just the willingness to cooperate together. Good will and good fellowship are not enough for what lies ahead of us--for we are not moving toward any gentle times.

The drumbeat of history is quickening.

Our generation is being mustered to the stern duty of sterner times.

Over the past 16 months, 55 governments, representing almost half the nations of the earth, have acquired new leadership. We have had nine governments alone in Viet-Nam since I became President.

Onto the horizons of every region in the world have come new facts and new forces and new faces with which the future must reckon fully.

So the world to which we have grown accustomed is today a changing world--unformed, unsettled, still uncertain, moved by new moods as well as moved by new men, influenced for good or evil by the new interpretations of the old dreams.

The season is profound. And let none underestimate it.

But let none here--and certainly none abroad--underestimate the fact of America's own profound change. I regard nothing as more immediately important than for all who share in the decisions of our system to grasp the magnitude of our task and of the change that is coming upon us.

All we have wrought in the 20 years since World War II must be done again--and more--in the 20 years that are ahead.

By 1985, our gross national product must more than double to a rate of $1 1/2 trillion.

In the next 20 years our job supply must increase nearly half again--to 100 million.

Our population in 1985 will exceed 266 million--and three-fourths of that number will be housed, fed, employed, schooled, transported, and protected in fewer than 200 metropolitan cities.

So we shall be not only a highly urbanized people but also the most youthful nation in all the West. Already our average age is dropping 1 year every year. One-fourth of all Americans are in classrooms each school day.

By 1985, more than half the citizens of this country will be too young to have any memories of the great war or the great depression or the sources of the great debates which so shape and mold the national policies that we adopt.

This season is profound for America.

Our strong and our successful society is moving literally away from the environment which has nurtured us for 188 years and has nurtured those values which have made it strong and successful.

We are thrust into a new environment which our technologies have allowed and have caused us to create. Our challenge is closely akin to that of Americans 100 years ago who carried the values of our society into the new environment of our western frontiers.

We can lose our values, and we will lose our society, in selfishness, in meanness, in callousness, or in ugliness. Or we can enrich and enlarge our values by concerning ourselves generously with the quality and meaning of life in our society.

Well, that is the course that I chose, and I believe it is the choice that you must make, too. Not because you are businessmen but because you are, first of all, responsible and caring Americans.

For nearly a century American politics has been dominated by economic promises-- from "forty acres and a mule" and "the full dinner pail" to "a chicken in every pot" and "full employment."

That thrust remains--and it must remain.

But I believe that in this period of transition and transformation we must be concerned no less with the issues that are reaching the soul and spirit of our people.

We must be concerned with the human mind and its education. We must be concerned with human dignity and its opportunity. We must be concerned with natural beauty and its preservation--all of man's environment and all of man's improvement.

The Great Society is not a welfare state-nor is it a spending state.

Its object is to give the individual identity and purpose and self-esteem--not to impose upon him an oppressive paternalism. Further, the Great Society seeks not to raise the costs of government but to reduce for the individual--and the Nation--the costs of obsolescence, waste, and neglect wherever such may exist in our national life.

This is our great need, and this is one of our principal purposes.

The source of our success as a society has always been invention and innovation. A very large part of the long-run growth of our gross national product, and of the growth in our output per man-hour, has come from technological progress.

Today that characteristic innovation and inventiveness of Americans is too often burdened down and stifled by the weight and waste of the past.

For the past 48 months, the expansion of our economy has been fueled in large measure by lifting the burden of obsolete depreciation schedules, by offering incentives for innovation and incentives for modernization, and, most important, by actually reducing tax rates in order to increase private demand.

We shall continue on this course.

We are asking a $1 3/4 billion reduction in excise tax rates this year, and that is overdue.

We are studying ways to lift and lighten the burden of archaic regulation of some of our most vital industries.

You of the NICB have worked with us on the study of company depreciation practices. And I believe you know that your work has borne fruit.

I am able to tell you today that your Treasury Department will shortly make public changes in the depreciation procedure which will allow business to receive this year more than $700 million of benefits that would have been lost under the original guideline procedure of the 1962 reform.

The new rules will further encourage business to scrap old equipment and to bring in new. They will further help business to cut costs but to raise efficiency, to hold the line on prices but to keep our expansion growing.

Yes, our challenges are many--on many fronts.

Tests that we face are stern, at home and throughout the world.

We must--and we are determined that we shall--keep the dollar sound and safe.

We must and our friends in Western Europe must make the Kennedy Round of tariff negotiations a success. And for our part, we are determined that they shall succeed.

We must--and we are convinced that we can--bring the unemployment rate lower. The current 4.8 percent is good, is an improvement, but it is still too high, for while the rate among white adults is now down to 3.4 percent, it is 7.2 percent for nonwhite adults and 29 percent for nonwhite teenagers.

Unemployment--like employment--must know no color line.

We must face--and we are--the necessity of bringing the fruits of our technology to middle and smaller contractors in every region and every State.

For us, as for the first Americans, the challenge is to think anew, to act anew, for really we are at the beginning of a new age in this Nation's history.

For this new age--for the continuing strength and success of our system--I attach the utmost importance to trying to maintain a respectful partnership between business and labor and their government.

Those who speak the false fear of Federal paternalism would do well to consider the living fact of Federal partnership. In times of trial, in times of hope, that partnership has imparted a mighty and noble purpose to our free enterprise system that has set to rest for our time and century all doubts as to its viability in a changing world.

The changes that are coming now are many.

We cannot know what will be asked of us ahead.

We can know, and we do know, that whatever its challenges, a responsible society cannot be indifferent to human needs.

Our prosperity and our progress, the prestige our free system enjoys throughout the world--all reflect the victory of the enlightened mind over the mean and the narrow spirit of other times.

So I ask you then, as enlightened men of our times, to join as full partners in all the problems of the Nation, the social problems as well as the economic problems. For we shall be judged not by what we take with us, but by the society that we leave behind us.

I have been talking to you about our social and our economic achievements and hopes here at home.

I should like to end this visit with you with a word on the very serious situation in Viet-Nam, which I know must be on the mind of each of you.

As I have said so many, many times, and other Presidents ahead of me have said, our purpose, our objective there is clear. That purpose and that objective is to join in the defense and protection of freedom of a brave people who are under attack that is controlled and that is directed from outside their country.

We have no ambition there for ourselves. We seek no dominion. We seek no conquest. We seek no wider war. But we must all understand that we will persist in the defense of freedom, and our continuing actions will be those which are justified and those that are made necessary by the continuing aggression of others.

These actions will be measured and fitting and adequate. Our stamina and the stamina of the American people is equal to the task. Thank you.